Cyberspying Expected To Be Discussed At U.S.-China Summit

Today, President Obama will be turning his attention to China. He's meeting China's new President, Xi Jinping, here in Southern California. There's plenty on the agenda: trade, currency, North Korea. This year, though, a new topic may dominate: China's habit of breaking into U.S. computer networks to steal trade and military secrets.

NPR's Tom Gjelten reports.

TOM GJELTEN, BYLINE: U.S. officials used to say only that some countries engage in cyber espionage. Everyone knew they usually meant China. They just wouldn't say so. But in March, the White House national security advisers singled China out, saying cyber intrusions were coming from there on an unprecedented scale. Two months later, the Pentagon tied the hacking directly to the Chinese government and military. Former Deputy Defense Secretary William Lynn says this new willingness to point a finger at China was a way to give more attention to the cyber espionage problem.

WILLIAM LYNN: What that reflects is two things. It reflects that the problem is getting more and more serious, and it reflects the fact that not naming China and trying to do it in more subtle and nuanced ways has not worked.

GJELTEN: Lynn followed cyber espionage closely at the Pentagon, until he left a year and a half ago. He's now chief executive at DRS Technologies, a defense contractor. Before leaving the Pentagon, Lynn asked the Defense Science Board to assess the vulnerability of U.S. weapons systems to cyber-attack and espionage. The subsequent report identified systems compromised by Chinese hackers. The Pentagon says the intrusions have not eroded U.S. military capabilities. Lynn has not seen the full report, but he notes it's not easy to determine the extent of damage done by cyber espionage.

LYNN: It's clear the theft is going on. It's somewhat less clear how effectively that property is being put to use. Just stealing it doesn't do you any good alone. What you have to do is to be able to use it in some economically and technologically efficient manner.

GJELTEN: At a minimum, Lynn says, we know China is modernizing its military in part by incorporating stolen U.S. technology. How do we know that? Two ways.

LYNN: The number of intrusions on both military sites and defense contractor sites that are clearly emanating from China, and the other is the correlation between some of our technology and some of the new developments in the Chinese military.

GJELTEN: A new Chinese stealth fighter rolls out, for example. Analysts suspect it's modeled after the U.S. Joint Strike Fighter. Reports of such correlations, however, are classified. Richard Bejtlich, chief security officer at the Mandiant firm, has investigated hundreds of cyber-attacks from China. The damage to defense systems, he says, depends on when the intrusions occurred and how much was taken.

RICHARD BEJTLICH: The best-case scenario is that the information was stolen a while ago. It was scoped to small elements of each program. So, while the program was compromised, not the entire program was compromised, and that whatever was stolen is something that could be changed at a minimum of time and cost impact.

GJELTEN: And then there's a worst-case scenario.

BEJTLICH: The information is so damaging that you're going to spend lots of money trying to fix the problem, or potentially not be able to fix the problems whatsoever and just have to have a new section in your user manual that says here's how we operate when using this equipment against the Chinese. It's going to be different, because they know quite a bit about it.

GJELTEN: Cyber espionage from China affects U.S. businesses, as well as the U.S. military. Private firms who are losing trade secrets and technology to Chinese hackers have pressed the Obama administration to challenge Beijing. Today's meeting with President Xi Jinping is one opportunity. The Brookings Institution's Jeffrey Bader was previously a China expert on Obama's National Security Council.

JEFFREY BADER: I think it's important for President Obama to impress upon Xi Jinping that this is not just the flavor of the month, but this is a hugely important issue that's not going to go away and that's going to corrode the relationship, and that Xi Jinping has to personally take charge of the issue within the Chinese system, not just let others run loose on this.

GJELTEN: At a briefing with reporters this week, a senior administration official said cyber espionage would become, quote, "a standing issue in all U.S.-China meetings." Tom Gjelten, NPR News, Washington. Transcript provided by NPR, Copyright NPR.